Sonic explored deeply the idea of an IPTV product, delivered over our fiber. The conclusion was that we couldn't deliver a quality product in a competitive way. There are two factors that drive this for us, but then a positive evolution in the marketplace:

First, content costs are far higher for small pay-tv providers than for large ones. As a result, a bundle of channels we'd deliver would cost more than the same line-up from one of the three or four choices everyone has today (Cable, DIRECTV, DISH and possibly Telco.)

Second, the quality of the set-top-boxes and interfaces available to smaller carriers is...poor. Put another way, the Hopper 3 and it's peers are really good (DTV's Genie, Comcast's X1, etc.) These solutions are exclusive to the provider who developed them (exception: Comcast licenses the X1 platform to some other Cable companies they do not compete with.) Solutions for carriers like Sonic are from vendors such as Conklin, Innovative and Minerva - and frankly, they have a "Hotel TV" type of interface experience. Just not as polished.

So the result is a too-expensive product with a poor user interface. Not a winner.

But the positive evolution is that TV has become an app. With the launch of YouTubeTV, Hulu TV, DIRECTV Now, and long-time options Sony Vue and Sling TV, it's finally possible to just subscribe to Pay TV over the Internet. (This is referred to as "Over the top" video, or "OTT".) No term commitment, no set-top box rental, and all the essentials like DVR and sports that folks want. Most consumers haven't yet absorbed or considered this option, but the traditional pay-tv subscription numbers and the OTT numbers do tell a story about what is to come.

Thanks for the details on the economic and technical realities of IPTV. However....

I worked for a brief but very pleasant time on Google Fiber's set-top box firmware, and the UI was pretty decent (it was basically Sage TV with some added work), supporting IPTV, DVR functions, and a program guide. Since you collaborated with Google Fiber during their prototype roll-out to bits of Palo Alto, I wonder if you've discussed licensing their set-top tech? Given that they're scaling back their fiber operations, it may be something they'd be willing to talk about.

You may not be able to overcome the channel licensing costs, but the set-top experience is a solvable problem.

This might have been a problem worth solving a few years ago, but today consumers can get TV over the Internet for a huge number of sources: SlingTV, YouTubeTV, HuluTV, Vue, DirecTV, etc. The internet will win, and consumers will save a lot and get a lot of new flexibility in the process. We need to provide some recommendations and guidance, but we don't have to package a solution.

Have you considered to try and maybe get sonic users a better deal on streaming? I see this all around me, that neighbors who used to have Comcast for TV and Internet now switched to sonic and hate Comcast more than ever. The main reason is, that Comcast is making it really difficult to unbundle. So if sonic gigabit customers could get a deal on Hulu, Youtube tv, etc, I'm sure many of them would jump on it. I am pretty sure that if sonic would talk to those streaming vendors, they could easily get a nice discount offer for their users.

cmeisel wrote:Have you considered to try and maybe get sonic users a better deal on streaming? I see this all around me, that neighbors who used to have Comcast for TV and Internet now switched to sonic and hate Comcast more than ever. The main reason is, that Comcast is making it really difficult to unbundle. So if sonic gigabit customers could get a deal on Hulu, Youtube tv, etc, I'm sure many of them would jump on it. I am pretty sure that if sonic would talk to those streaming vendors, they could easily get a nice discount offer for their users.

I’m not optimistic about discounting, but we are in discussions with a couple of the Internet TV options to see if we can provide our members with a good path.

dane wrote:This might have been a problem worth solving a few years ago, but today consumers can get TV over the Internet for a huge number of sources: SlingTV, YouTubeTV, HuluTV, Vue, DirecTV, etc. The internet will win, and consumers will save a lot and get a lot of new flexibility in the process. We need to provide some recommendations and guidance, but we don't have to package a solution.

dane wrote:Put another way: do you need your ISP to bundle Netflix? Nope.

I may not want Sonic to bundle Netflix, but bundling KRON, KPIX, KGO, KNTV, KTVU, KOFY, KCRA, KQED, KCSM (i.e. local broadcast stations and network affiliates) could be useful.

The idea of a "skinny local" package was something we spent a lot of time looking at a couple years ago. But the stations at the time really wanted to see a conventional set-top box and experience - not an app. And launching an app, and clearing their content security auditing etc was a challenge. And getting onto platforms beyond Roku was also a big lift.

And today, those locals can all be found on YouTubeTV, and a number of other streaming services too. And there are some promising new developments like LoCast https://www.locast.org/ for example that could totally disrupt this space. It's such a dynamic market, in the end it didn't make sense for us to jump in.